NEWS – MONDAY 6TH APRIL 2020
NEWS – MONDAY 6TH APRIL 2020
CORANA VIRUS GOVERNMENT SUPPORT – LATEST
HMRC reimbursement for furloughed employees:
As the government release more details, here is the latest update for furloughed employees: –
TAX NEWS – MONDAY 6TH APRIL 2020
3 in 4 back higher taxes for the wealthy
A survey by the Tax Justice Network shows that 74% of people believe wealthy individuals and firms should pay higher taxes. Of the 3,010 people polled, 66% said those who profit from wealth should face the same tax rates as workers, while 87% urged the Government to close loopholes which enable tax dodging. It was also shown that 24% of people did not want to pay more tax personally. Commenting on the findings, Tax Justice UK boss Robert Palmer said: “People have had enough of clever accounting that allows companies and wealthy individuals to pay less than they should.”
Daily Mirror, Page: 2
Players warn wage cut would hit tax for NHS
With the Professional Footballers’ Association (PFA) having resisted calls for top flight players to take a 30% pay cut amid the COVID-19 crisis, it has warned that such a reduction would result in far less in taxes going to the NHS. In a statement, the PFA said the proposed salary deduction over a 12-month period “equates to over £500m in wage reductions and a loss in tax contributions of over £200m”, asking what effect this loss of earning to the Government would mean for the NHS.
The Guardian, Page: 42 Financial Times, Page: 11
INSOLVENCY NEWS – MONDAY 6TH APRIL 2020
Insolvency numbers ‘incredibly low’ – Nimmo
Blair Nimmo, head of restructuring for KPMG, says that while there may be an increase in insolvencies, the number of firms going bust during the COVID-19 pandemic is “incredibly low at the moment”. While acknowledging that some firms are folding, he highlights that many more are being mothballed, adopting careful cash management and seeking support to stay afloat. Saying that seeing viable companies entering insolvency is the “last thing we need right now”, he suggests that “if businesses were viable before the pandemic, they can be viable again.”
The Press and Journal, Page: 27
CORPORATE NEWS – MONDAY 6TH APRIL 2020
Lights go out on more electricity suppliers
A record 24 electricity suppliers went bust in the UK last year, up from 17 in 2018 and five the year before, according to data from Price Bailey. The firm’s Paul Pittman warns of the knock-on effect when an energy retailer collapses, saying: “We are seeing a domino effect. Every time a small energy retailer does go bust, that increases the financial strain on the rest of the supply chain, making those businesses more vulnerable to collapse.”
Daily Express, Page: 24 The Press and Journal, Page: 28
Retailers at risk
Struggling retailers face a crunch week, with Debenhams having brought in KPMG to prepare for a possible collapse; homeware retailer Cath Kidston reportedly on the brink of going bust and set to appoint Alvarez & Marsal as its administrator; and Arcadia, owner of chains including Topshop and Dorothy Perkins, said to be plotting to offload hundreds of stores.
The Times, Page: 34 Daily Mail, Page: 63
SMEs NEWS – MONDAY 6TH APRIL 2020
Support schemes fall short for entrepreneurs
Phillip Bond, director of the ResPublica think-tank, says that while Chancellor Rishi Sunak’s measures to support both the self-employed and employees amid the coronavirus outbreak have been “bold and ambitious”, a number of people are falling between the gaps of the two main support schemes. He notes that the self-employed are only covered if they have been fully self-employed for a year, before highlighting that the owner/directors of Britain’s small businesses are “almost wholly unsecured”. Mr Bond says that many, “almost universally on accountant’s advice”, have given themselves minimal salaries and pay themselves mostly through dividends. The structure of the Government support schemes means people in this position who self- furlough will only see 80% of their small salary. He argues that minsters are “abandoning” Britain’s entrepreneurs.
SMEs short on debt cash
UHY Hacker Young has analysed the balance sheets of more than 13,500 SMEs and warns that the average small business does not have enough money to cover debts due in the next year. On average, UK SMEs hold 95% of the cash needed to pay debts due in the next 12 months. Martin Jones of UHY Hacker Young said: “It’s worrying to see British SMEs struggling to pay their short-term debts already,” adding that there is “no doubt the coronavirus disruption is going to make the situation even worse over the coming weeks and months.”
The Scotsman, Page: 10 Daily Express, Page: 50 Yorkshire Post, Page: 11
PROPERTY NEWS – MONDAY 6TH APRIL 2020
Half a million house sales to be lost
Analysis by estate agency Knight Frank suggests that more than half a million property sales will be lost this year due to the ongoing coronavirus crisis, warning that prices are set to fall by 3%. It estimates that transactions will fall from 1.18m last year to 734,000. In analysis assuming the lockdown lasts through April and May before restrictions are eased in June, Knight Frank says prices are likely to dip 3% through 2020 but rebound to 5% growth in 2021. Having previously forecast that 2020 would see 1.26m transactions, it now expects 526,000 sales to be lost and less than half of those to be carried into 2021.
The Times, Page: 36 The Guardian, Page: 31
PERSONAL FINANCE NEWS – MONDAY 6TH APRIL 2020
Government to pilot no-interest loan scheme
The Government is to pilot an initiative offering no-interest loans for people on low incomes, with a Treasury-commissioned report saying a no-interest loan scheme (Nils) would be feasible, with cash coming from either a government body or existing lenders. With the scheme primarily aimed at lower-income earners who cannot afford to repay interest on loans of between £200 and £2,000, the London Economics report notes that more than 400,000 people in Britain would be eligible. While the Treasury has said a pilot will be rolled out, a spokesperson declined to give a timetable. Nor would they comment on whether Chancellor Rishi Sunak would use the Nils as a relief measure amid the COVID-19 pandemic.
OTHER NEWS – MONDAY 6TH APRIL 2020
Home working puts businesses at risk of fraud
The FT looks at how a coronavirus-driven shift to home-based work increases the risk of fraud, including in regard to accounts, with input from Mazars’ Bob Neate and Scott Knight of BDO.
PM’s brother likes Starmer tweets
Looking at how the Prime Minister’s brother has recently liked a number of social media posts praising new Labour leader Sir Keir Starmer, the Mail notes that Leo Johnson works as a forecaster for PwC.
Daily Mail, Page: 20
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